Future World Cups May Rest on FIFA’s Battle for Public Favor

The 2014 FIFA World Cup has arrived ushered in by protests, strikes, delayed stadium construction and incomplete infrastructure projects.  While the World Cup in Brazil will surely captivate perhaps one of the largest television audiences in sporting history, the scrutiny over FIFA’s financial practices has also reached a greater audience.

In the recent build up to the 2014 World Cup, the media has repeatedly highlighted the amount of money spent on bringing the World Cup to Brazil and the projected financial impact that the tournament will have on the South American nation.  The 2014 World Cup is perhaps the most expensive ever with $11 billion spent. 

Two schools of thought have emerged about the economic impact of hosting the World Cup: the World Cup will have a lasting positive impact on the nation or the financial impact of the World Cup will merely be a rain drop in the ocean.  Vice President of Moody’s Investors Service, Barbara Mattos, said,

The 32-day event will provide short-lived sales increases that are unlikely to materially affect earnings and disruptions associated with traffic, crowding and lost work days will take a toll on business.

On the other hand, tourism minister Vinicius Lages stated the opposite, maintaining,

The Cup is not an economic panacea but a catalyst for Brazilian development.  It was a key factor behind Brazil finally overhauling its infrastructure.

Only time will tell if the World Cup will help the nation, hurt the nation, or land somewhere in between.  Whether the World Cup will truly benefit Brazil or not, mass media has not been kind to FIFA, who has drawn heavy criticism from the public and various media outlets.  Even HBO comedic news anchor John Oliver has recently captivated audiences with an anti-FIFA segment on his show Last Week Tonight.  Oliver highlights the corruption surrounding FIFA in the past few years along with some of the demands FIFA had allegedly made to Brazil to prepare for the World Cup.

FIFA has shot back at its critics by releasing a FAQ on Tuesday about the misconceptions of the World Cup in Brazil titled “Setting the record straight”.  FIFA states that it has contributed $2 billion to all World Cup operations and acknowledged they have not used any public money in support of the tournament.  The document also states that $1 billion of the $2 billion spent by FIFA on the World Cup is spent on services, money that is injected directly into the Brazilian economy.  FIFA projects that the economy will see $27.7 billion in additional income from hosting the World Cup.

FIFA adds that there was no reallocation of money from education and health budgets to build stadiums.  FIFA did not demand that Brazil build 12 stadiums and FIFA did not force evictions of citizens to make way for stadiums.

FIFA reiterates their social responsibilities in bringing a World Cup to a nation, and highlights their efforts in reducing environmental waste in Brazil and promoting health initiatives.  FIFA adds,

FIFA believes that its social responsibility is a crucial element of the sustainable success of its events, but the World Cup can only be used as a tool or as a catalyst for change in a country if everyone involved pulls in the same direction as part of a global strategy.

FIFA is making attempts to change the public’s perception of the organization and hopes that the public sees hosting the World Cup as an opportunity rather than a detriment to a nation.  This should be a top priority for FIFA considering the awarding of the 2022 World Cup to Qatar is currently under investigation for corruption allegations.  It is in FIFA’s best interest to change the negative public perception in the coming years.  Failing to do so may see a public tired of the corruption soon turning their backs on the tournament they love.  Soccernomics author Stefan Szymanski argues that the top soccer nations of Europe and South America need other nations to compete more than the other nations need Europe and South America.

For the next thirty days the public may very well forget about economic, social, and environmental problems in Brazil.  The question remains, what will happen when the ball stops rolling?

 

What do you think about FIFA’s current standing with the general public? Let us know in the comments section below, or via Facebook or Twitter.

Reporting on the business side of the world's game.